In the past few decades, the prime considerations for FDI like degree of openness are becoming more or less same for all economies. It is the policy factors like taxation which have now become significant for investment decisions. In this respect one of the major issues is double taxation. This paper attempts to cover various aspects in relation to double taxation including tax treaties, unilateral and bilateral relief and above all the benefits and cost associated with signing a tax treaty. The review of literature conducted in respect of developed, developing and OECD nations highlights few important aspects in the context of Double Taxation Avoidance Treaties: age of treaty, treaty renegotiation, influence of regional peers and the country specific factors like income. This paper also discusses the case of India-Mauritius tax treaty which has been a debatable issue for long.